D.C. Schools Chancellor Michelle A. Rhee will announce Wednesday that she is resigning at the end of this month, bringing an abrupt end to a tenure that drew national acclaim but that also became a central issue in an election that sent her patron, Mayor Adrian M. Fenty, to defeat.

Rhee survived three contentious years that made her a superstar of the education reform movement and one of the longest-serving school leaders in the city in two decades. Student test scores rose, and the teachers union accepted a contract that gave the chancellor sweeping powers to fire the lowest-performing among them.

But Rhee will leave with considerable unfinished business in her quest to improve teaching, close the worst schools and infuse a culture of excellence in a system that has been one of the nation's least effective at educating students.

She will be replaced until at least the end of the school year by Deputy Chancellor Kaya Henderson, a close associate.

Rhee and presumptive mayor Vincent C. Gray recently reached a "mutual decision" during a phone conversation that it was best for her to step down, said people close to both, who spoke on the condition of anonymity. "They both agreed the sooner they could put this to bed, the better for the kids and the community, " an official close to Gray said.

Under the deal, the school system's senior leadership team will also remain in place under Henderson through the school year to reassure parents that there will be minimal disruption.

Gray and Rhee declined to comment Tuesday. But a news conference planned for Wednesday morning appears designed to demonstrate that Rhee, Gray and Fenty are united in pursuing school reform while easing dissension in the community over Rhee's tenure. Fenty, who plans to appoint Henderson to the interim job at Gray's request, is expected at the news conference.

The move won immediate support from the Washington Teachers' Union, which has long battled Rhee. "I think leaving sooner is better than later, so there will not be all this speculation," said union head George Parker. "Making a decision will relieve the tension."

But D.C. Council member Mary M. Cheh (D-Ward 3), who endorsed Gray but has generally supported Rhee's initiatives, said, "I'm deeply disappointed â¦ We always heard it was about the children. I don't think it is good for the children for her to leave in the middle of the fall. I had always hoped that if she wanted to leave she'd be part of a smooth transition."

Rhee's departure has been anticipated since Fenty was defeated in the Sept. 14 Democratic mayoral primary. She campaigned on his behalf and questioned whether Gray had the political will to make the unpopular decisions she thought were necessary to sustain school improvement.

Two weeks ago, Gray and Rhee met for about 90 minutes to begin talking about her future and the chairman's vision for school reform. Since then, the two have held several private phone discussions, said those familiar with the discussions.

Gray and Rhee agreed that the debate over her future was becoming a distraction for teachers, students and parents, people close to them said.

"She feels it's important people understand it was a mutual decision and the two leaders came together to do what's best for the city, the kids and the school system," a person close to Rhee said.

In Henderson, Gray inherits someone in tune with Rhee on the fundamentals of education reform, especially the belief that teacher quality is the most important determinant of student success. Rhee and Henderson worked together at the New Teacher Project, a teacher recruiting nonprofit group that Rhee founded and ran before she was appointed by Fenty in June 2007. Henderson was a vice president for the group.

She was Rhee's first appointment and was named her top deputy the day Rhee was introduced to the District. At the time, Rhee made it sound as if they had come to the District as a package.

"I told Kaya, 'I can't do this without you,'â" Rhee said at the time. "She's everything you'd want in a leader. She has an ability to motivate people. She's a critical thinker, and she's an innovative thinker."

At the New Teacher Project, Henderson ran the organization's D.C. operation, which had contracts with D.C. public schools to supply teachers. Before that, Henderson worked for Teach for America - where Rhee began her educational career - teaching middle school Spanish in the South Bronx.

At a D.C. Council meeting last year, Henderson recounted her first impressions of the city's struggling school system and her aspirations to change it. "I was stunned at the lack of commitment to ensuring the highest-quality educational force in the country," Henderson said. "The District tolerated people and practices that other school systems would never accept."

At a meeting in August of school principals, Henderson offered a football coach-style motivational talk, reinforcing Rhee's core message: that poverty and other conditions outside the classroom are not an excuse for poor academic achievement.

"Our responsibility is to deliver the goods, no matter what the situations our students are in," she said. "The reform is in the schoolhouse. You are here because we believe you are the right people to deliver this reform. The election is not our concern; the election is not your concern. Go hard, or go home!"

As deputy chancellor for "human capital," Henderson was a key figure in the firing of 98 central office employees in 2008. She was also lead D.C. negotiator on the marathon contract talks with the Washington Teachers' Union, which led to a labor pact that establishes classroom performance - rather than traditional seniority - as the main factor driving job security.

But Henderson was known to have a decent relationship with Parker.

"I respect her because she is a collaborative person, but also a very strong reformer," Parker said Tuesday night.

Rhee's goals - higher student achievement, better teachers and greater accountability for their classroom performance - were generally shared by her predecessors. But with new powers putting the struggling school system under mayoral control, Rhee pursued the goals with an unprecedented zeal.

She closed more than two dozen schools, fired teachers by the hundreds and spent more than two years negotiating a labor contract that gives principals new control over teacher hiring while establishing a new performance-pay system that ties compensation to growth in student test scores.

Rhee also dramatically expanded the number of spaces in preschool, pre-K and Head Start, and opened the Early Stages diagnostic center to help flag learning disabilities in children ages 2 to 5. She piloted a program of "wrap-around" support services for at-risk middle school kids and launched a program of "themed" schools focusing on science and technology, world cultures and the arts.

"I'm shocked that she's leaving so quickly," said Ted Trabue, president of the D.C. State Board of Education. "I really thought [Gray and Rhee] would work something out so that she stayed until the end of the academic year. I thought it would have been in the best interests of the students."

Gray has said that he supports an ambitious program of school reform but does not think that change depends on a single person. In an interview with The Washington Post last week, he said that if Rhee left, he would seek a replacement who shares many of her values and is not a veteran who has spent several decades in top school jobs.

He ruled out Rhee's predecessor, Clifford Janey, whose name had circulated as a possible replacement. Other prominent names include Robert Bobb, the former D.C. school board president and city administrator who is now the fiscal overseer of the Detroit school system, and former D.C. State Superintendent of Education Deborah Gist, now Rhode Island commissioner of education. Some have suggested that Henderson could become Rhee's permanent replacement.

Staff writer Mike DeBonis contributed to this report.

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